South Korea’s second and third largest life insurers Hanwha Life Insurance Co. and Kyobo Life Insurance are expected to bid for the government stake in Woori Bank, raising hopes that the bank could finally privatized after four failed attempts.

The government earlier announced that it would split up the 30 percent stake held by state-run Korea Deposition Insurance Corp. (KDIC) into splinters of 4 percent to 8 percent to facilitate the sale. KDIC currently owns a total of 51.06 percent in Woori Bank that was created after bailout and merger of several banks following the 1997-1998 financial crisis.

According to sources from financial authorities and insurance industry on Thursday, Hanwha Life is considering to bid for a 4 percent. The sale price would amount to 293 billion won ($262 million) based on Woori Bank’s Thursday closing at 10,850 won. Hanwha Life has pushed back the board meeting scheduled on Friday to September 22nd, a day before the KDIC plans to receive a letter of intent (LOI) from investors, to discuss and approve the bid plan.

An unnamed source from the insurance company said that Hanwha Life has already had talks with financial authorities.

The biggest motivation for Hanwha is to strengthen its bancassurance business in partnership with the bank. Hanwha has been focusing on expanding bancassurance business in South East Asia including Vietnam and Indonesia by joining hands with Woori Bank.

The cooperation between Hanwha and Woori is expected to generate a great synergy effect on expanding their overseas business. Woori Bank has a broad global network including 131 branches its Bank Woori Saudara has in Indonesia, and plans to increase the number of its global network to 400 by the end of this year. Hanwha Life has established a strong foothold in the Vietnamese market where it ranked 8th among the 17 life insurers in the country, and also has eight branches in Indonesia.

Hanwha is also believed to have been persuaded by authorities to buy the government stake.

The KDIC is Hanwha Life’s third largest shareholder with a 15.25 percent stake.

The nation’s third largest life insurer Kyobo Life is also considering bidding for a part of Woori Bank. An unnamed source from the industry said that Kyobo has long been interested in the sale and is weighing benefits and costs of the stake purchase.

By Park Joon-hyung

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